Churchill Downs, Inc. and Subsidiaries - Page 3




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          Federal corporate income tax return.  When the petition was                 
          filed, petitioners’ principal place of business was located in              
          Louisville, Kentucky.  Petitioners own the Churchill Downs                  
          racetrack in Louisville, Kentucky, and three other race tracks.             
               Petitioners conduct live horse races, including the Kentucky           
          Derby, at their facilities.  The races produce revenues through             
          pari-mutuel wagering (including simulcast pari-mutuel wagering),            
          admissions and seating, concession commissions, sponsorship                 
          revenues, licensing rights, and broadcast fees.  The main source            
          of petitioners’ revenues is wagers placed on horse races.                   
               Petitioners do not directly compete with other racetracks              
          for local patrons because of the separation of facilities and the           
          differences in the seasonal timing of meets.  However,                      
          petitioners operate in a highly competitive industry.  They                 
          compete for patrons with other sports, entertainment, and gaming            
          operations, including land-based, riverboat, and cruise ship                
          casinos and State lotteries.                                                
               Petitioners’ biggest race is the Kentucky Derby.  The                  
          Kentucky Derby is held each year on the first Saturday in May.              
          Petitioners’ Kentucky Derby events include:  The Sport of Kings             
          Gala, a brunch following the post position drawing for the Derby            
          race, a week long hospitality tent with coffee, orange juice, and           
          donuts for the press open from 4 a.m. to 9 a.m., the Derby race,            
          and the Kentucky Derby Winner’s Party.                                      






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Last modified: May 25, 2011